We have to
admit to being as surprised as everyone else at the stock market’s reaction to
the Donald Trump victory.And it is not
because we think the policies of the incoming administration will be less
growth oriented than the Obama or the not to be Clinton administration.Quite the contrary.President-Elect Trump’s policies will be
friendlier to business and to the taxpaying public than the alternative. [More]

We have been
discussing (in the most critical way possible) the Central Banks all over the world for the past 16 years.In fact, a journalist called us this past
January and asked what we thought of the stock market?We responded that we expected the stock
market to decline sharply during the year 2016 as the Fed raised rates.The journalist countered that every time the Fed raised rates in the
past the stock market still did quite well.So far the journalist has been correct and we have been wrong.We believe this will change again within the
next few months since the Fed will be forced to finally reverse the damage done over the past 8 years.

We tried to
explain to the journalist that we are presently in a completely different
situation than we were in the past, when the stock market rose as the Fed
raised rates because the economy was doing well and/or there were inflationary
risks.Now we have gone through QE1,
QE2, QE3, and “Operation-Twist” where we drove rates down to zero (ZIRP), or
close to it for the past 8 years.This
time the Fed has grown its balance sheet from about $800 bn. [More]

It's time Stephen Sondheim wrote another carnival song, and, more specifically, a sequel to the hauntingly memorable "Send in the Clowns" from his 1973 musical, A Little Night Music, which has proved so eerily prophetic in describing this year's political scene. As a glance at the crowded roster of Republican wannabe candidates for the presidency in next year's election makes clear, the powers that be in the GOP obviously have taken quite literally Sondheim's injunction that served as the title of the song, while the Democrats already have their very own barker and no shortage of mountebanks ensconced in their big tent. [More]

Short-selling funds are ready to come out of hibernation. Bear funds have had a rough run the past two years, as their strategy of betting against stocks has put them on the wrong side of a solid bull market. [More]

NORMALLY, WE DON'T GIVE a hoot as to who wins when one bunch of 25 millionaires takes up glove and ball against another bunch of 25 millionaires. It's like rooting for Gates against Buffett, or visa versa, when they don their knickers and face off in a game of golf. [More]

Here's what we found in examining the last seven economic recoveries: In the first 30 months of the last seven cyclical expansions, employment rose by an average of 7.4% (range: 9.6% to 2.6%). This includes one cycle that peaked in 24 months with a gain of 7.4%. [More]

A Simple CalculationBarron's Magazine5/31/03Price divided by earnings: What could be easier?
By CHARLIE MINTER and MARTY WEINER
THE READERS OF MOST financial publications must be somewhat confused by the different P/E ratios that are used by the so-called experts on Wall Street. They read or hear a well-respected analyst or strategist eloquently making a very compelling case as to why the market is more undervalued now than almost any time in history. [More]

The list of negative factors affecting the stock market has now become so numerous that it is highly likely that a severe bear market has already started. We begin with the fact that, as measured by earnings and dividends, this is by far the most overvalued market of the past century. [More]

A reporter asked us about the prospects of the stock market if the Fed raises the Fed Funds rate, since at the time there was a strong possibility of a rise in the rate to around 25 basis points. We explained that, in our opinion, the ending of the ZIRP (Zero Interest Rate Policy) and increase in Fed Funds will be a significant negative for the stock market. [More]

Financial Sanity3/11/13Dear Sirs,
Just had to say to you thank you, thank you for your wonderful financial sanity.

Comment on Cycle of Deflation2/15/13Hello from Ireland again (i've mailed a few years over the past). I still enjoy checking your excellent site every friday morning. One comment on the cycle of deflation - you have plant closing & debt defaults happening after competitive devaluation however this, to a large degree and in Ireland anyways, seems to have come first. Maybe you could explain this?
Also, I have to say that even though I think you are right and will be proven so soon enough, you tend to underestimate [having read your column for ten years now I think you underestimate by a 2-4 years] the reflationary power of Central Banks and for how long they can keep them up for. [More]

Cycle of Deflation theory1/18/13I'm sure that other regular readers of your commentary have noticed the term "beggar-thy-neighbor" showing up more and more in the press and online. It seems to validate the "cycle of deflation" theory you have posed for so long. We've been warned. Thanks.

Wonderful analysis that I have been reading for many years9/03/11I would like your permission to send a copy of your 8/25/11 market commentary to them since I agree that we are in a major credit/debt contraction of hugh scale and a good deal of the asset write-downs are ahead not behind us. irrespective of your answer I want to thank you for wonderful analysis that I have been reading for many years.

Your Message is Loud & Clear8/25/11Your weekly commentary plus the weekly postings on John Hussman's site should serve as required reading for anybody trying to follow this market.
Your message (much more concise than Dr Hussman's, I have to say)is loud & clear.